Bank of Japan Lifts Interest Rate – Currency Thoughts
Bank of Japan Lifts Interest Rate
January 24, 2025
The new 0.5% Bank of Japan interest rate is not only its highest since November 2008 but also matches its highest point since September 1995. This week’s Bank of Japan Board meeting coincided with an updated Outlook for Economic Activity and Prices with new forecasts that leave projected growth closely aligned with those made last July and October but that bump up projected fiscal 2025 core consumer price inflation (excluding fresh food but not energy) by a half percentage point to an above-target 2.4%. Today’s decision, which was favored by 8 of 9 Board members are summarized here.
More rate hikes are likely to follow. “If the outlook presented in the January Outlook Report will be realized, the Bank will accordingly continue to
raise the policy interest rate and adjust the degree of monetary accommodation,” but Governor Ueda reiterated in a subsequent press conference that there is no predetermined time table. Nakamura cast the sole dissenting vote on the rate hike, preferring to wait a meeting by which time an expected acceleration of wage awards this spring can be confirmed.
Copyright 2025, Larry Greenberg. All rights reserved. No secondary distribution without express permission.
Tags: Bank of Japan
ShareThisYou can leave a response, or trackback from your own site.
Leave a Reply
You must be logged in to post a comment.
